May 1, 2022
BTC SSOV-p - Single Staking Put Option VaultsSSOV
Did you know Dopex has BTC SSOV-put vaults?
This vault will allow the users to either write put options on BTC (using stablecoins as a collateral) or to buy put options on BTC.
The vault will be deployed on Arbitrum.
Taking the market conditions in consideration there are two strategies to profit from a put option!
- A put is a strategy traders or investors may use to generate additional yield and/or buy BTC* at a reduced price.
In other words, the sale (writing) of put options allows market players to gain bullish exposure, with the added benefit of potentially owning the underlying tokens at both a future date and a price below the current market price.
- Traders buy a put option to magnify the profit from BTC's decline. For a small upfront cost, a trader can profit from BTC prices below the strike price until the option expires. By buying a put, you usually expect BTC's price to fall before the option expires.
- Buying put options as an insurance. A put option gives the buyer the right to sell BTC at a set price on a predetermined date. This means that no matter how low BTC goes, the investor has the right to sell BTC for the agreed upon price.
*Please note that the underlying token to be traded is in USDC/USDT, the reference token is BTC.
ℹ️ Two important updates for deposits from May '22 onwards!
- SSOV-Ps will move to weekly epochs via SSOV v3
- SSOV-Ps will provide DPX rewards!
💰 In the initial batch, we've launched SSOV-p on Arbitrum, for the following tokens:
ℹ️ The vaults will work as follows:
- Option writers will be able to deposit their stablecoins in the Vault
- The stablecoin collateral required will be equal to the chosen strike price x amount of underlying tokens
- SSOV-p will place the stablecoins in the Curve 2pool on Arbitrum and stake in the gauge to earn Curve transaction fees and CRV rewards
- Option writers will write put options to buyers at fixed strikes that they select for end-of-month expiries
- At the expiry, the users will claim back their deposits in the form of 2pool tokens
⏰ Deposits are going to open SOON (after Friday 29th April) and will close a few days after.
The SSOV-p Epoch will run for a month (until we launch SSOV v3). Before we open deposits, we will notify users via Discord and Twitter. Put purchasing will begin immediately after the deposit period ends.
Note: The deposits will be open only for a few days, afterwards the trading will commence
- Underlying collateral: Curve 2pool (USDC and USDT)
Put Option Pricing Details:
BTC put options will use Implied Volatility parameters (IVs) based on the aggregated levels from secondary option markets
What is SSOV?
Similar to single staking vaults, SSOV allows users to lock up tokens for a specified period of time and earn yield on their staked assets. Users will be able to deposit assets into a contract which then sells your deposits as put options to buyers at fixed strikes that they select for end-of-month expiries. SSOV options are either at the money, out of the money, or far out of the money.
If you are not familiar with SSOV concepts, read these articles first:
Arbiscan explorer link:
To learn more about Curve:
Risk warning: Cryptocurrency trading is subject to high market risk. Please make your trades cautiously. You are advised that exchanges are not responsible for your trading losses.
Dopex is a decentralized options protocol that aims to maximize liquidity, minimize losses for option writers and maximize gains for option buyers — all in a passive manner.
Dopex uses option pools to allow anyone to earn a yield passively. Offering value to both option sellers and buyers by ensuring fair and optimized option prices across all strike prices and expiries. This is thanks to our own innovative and state-of-the-art option pricing model that replicates volatility smiles.
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Dopex reserves the right in its sole discretion to amend or change or cancel this announcement at any time and for any reasons without prior notice.
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